Northeast Ohio auto sales boom, growing at double the national rate

Gus Chan / The Plain DealerCadillacs line the lot at Crestmont Cadillac in Beachwood on Monday. In Northeast Ohio this year, auto sales are up nearly 22 percent, more than double the national average. Some economists are surprised by the local strength, saying they can't be sure what's behind it.

CLEVELAND, Ohio -- Car shoppers in Northeast Ohio are snapping up new vehicles twice as quickly as people in other parts of the country.

Ken Mayland, president of Pepper Pike's ClearView Economics, said his best guess is that Northeast Ohio's auto sales were badly depressed in 2009 and 2010. So, returning to normal creates bigger growth numbers than in other parts of the country that didn't experience as severe of a dropoff.

"The regional economy was harder hit than the national economy," Mayland said. "If you're more volatile on the way down, you're going to be more volatile on the recovery side as well."

Made in Lordstown, the vehicle is selling well in the region. AutoViewOnline.com, a research service that tracks auto sales in Ohio, shows the Cruze as the No. 4 vehicle in the state last month behind the Ford Escape, Ford Fusion and Toyota Camry. A year ago, the Cruze's predecessor, the Chevrolet Cobalt, was No. 22 in August.

GM has been one of the strongest performers in the region. Nationally, GM's sales are up 16 percent this year, but in Northeast Ohio, they're up 46.8 percent -- nearly triple the national figure. Chevrolet spokesman Brian Goebel said the Cruze has been the biggest contributor to the gain, but he said the Equinox crossover has also sold very well.

"Northeast Ohio's market has always been more of a passenger car market [rather than a commercial truck market] and our best performers nationally have all been passenger cars," Goebel said.

So Dubin's explanation that people in the region are showing some brand loyalty to GM makes some sense. . . until you look at Chrysler's results.

Chrysler shut down its only Northeast Ohio assembly plant a year ago when it shuttered the Twinsburg Stamping Plant. But Chrysler's sales are up 61.2 percent locally, far better than the 22.4 percent national growth rate.

Even stranger, the Cleveland area numbers are significantly stronger than Chrysler's results in Toledo where its Jeep plants are booming. Chrysler officials said Toledo area sales were up 31 percent during the first half of the year.

As with GM, the Chrysler spokesman credited better cars for the increase, but he couldn't explain why its cars were selling so much more quickly in this region than in other portions of the state that have traditionally been better markets for the company.

Both Mayland and Guhan Venkatu, an economist at the Federal Reserve Bank of Cleveland, pointed at the local unemployment rate as another possible explanation.

Going into the recession, the Cleveland area's unemployment rate was higher than the national average. But this year, it has been slightly lower. In July, for example, the national rate was 9.1 percent while the Cleveland area rate was 9 percent. It's a small gap, but a year earlier, the national rate was 9.5 percent unemployment but the Cleveland rate was 10 percent.

View full sizeRobert Schoenberger/The Plain DealerNortheast Ohio's auto sales have consistently beaten national growth figures. So far this year, the Cleveland area has more than doubled national growth levels.

"We've been below the national average pretty consistently," Venkatu said. He added that he can't say definitively if the lower unemployment rate has led to more car buying, but "it makes sense. [Unemployment rates] are related to jobs and income, and those are both pretty good indicators for car sales."

Whatever the reason for the gains, the return to double-digit sales growth was a welcome turnaround for dealers after a disappointing July. Overall August sales were up 14 percent in Northeast Ohio. In July, the 3.6 percent gain was the only single-digit sales performance of the year.

Chrysler and GM led the sales growth with Hyundai and Nissan both up about 20 percent. Ford's sales were up about 8 percent in August, below the 11 percent pace the company has set for the full year.

The only major automakers to post sales declines were Toyota and Honda. Though down 13 percent, Toyota's sales rebounded from the 29 percent drop posted in June and the 26 percent July decline. Honda, on the other hand, posted its worst sales decline of the year at 30 percent.

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